As investment managers run through the tape towards an incredibly productive 2021, many are now looking ahead to 2022. What will the new year bring?

Two years ago no one could have foreseen the imminent downturn or the agent that caused it. Nor one year ago were the course of the pandemic, vaccines, or 25% run of public equities predictable.

So we approach forecasts knowing variables are legion and interrelationships complex. But having witnessed remarkable private credit performance over the past 24 months, we feel comfortable highlighting key themes around the outlook for next year.

Activity levels. 2021 was characterized by the unleashing of pent-up private credit demand from issuers and investors. Some was a response to catching up from last year‘s stuck-at-home dynamics. But a lot was attributable to the virtues of the asset class highlighted by Covid: relative yield, less correlation and lower defaults. Will these benefits hold for next year, or weaken from competitive pressures?